Bank of America's foreclosure arm agreed this week to pay $1.1 million to settle allegations by Washington Attorney General Rob McKenna that it failed to comply with state laws.

But the consent consent decree calls for the state to credit the $1.1 million against what Bank of America owes as part of a $25 billion settlement of a multi-state investigation into loan servicing.

"The money was part of the larger settlement," McKenna's spokeswoman Janelle Guthrie said. In all, Washington stands to get $648 million in relief and direct payments from that settlement, she said.

Under the consent order filed Tuesday in U.S. District Court in Seattle, ReconTrust Co. agreed to stop operating in the state. It admitted no wrongdoing. ReconTrust also operates in Oregon.

McKenna's office sued last year, alleging ReconTrust lacked an office in the state, in violation of state law. He also argued that the company had improperly handled thousands of
foreclosures by using robo-signed documents and conducting
foreclosure sales in garage and hotel ballroom.

His office alleged that ReconTrust failed to act as a neutral third party on behalf of both the
lender and the borrower, in violation of state law. Such practices made it difficult for borrowers to halt foreclosures while working to save their homes, McKenna alleged.

If ReconTrust returns to operating in Washington, it cannot act as trustee in foreclosures where it's also a beneficiary of the trust deed, according to the settlement. It also must provide offices where borrowers can resolve foreclosure issues, McKenna's office said.